Arrangements for closing down unregistered schools are “inadequate” and too many children remain “at significant risk of harm”, Sir Michael Wilshaw has said.

In a letter to education secretary Nicky Morgan, the Ofsted chief inspector outlined how the inspectorate had uncovered 15 unregistered schools serving 800 pupils since September last year, but no individual had ever been prosecuted for running such an institution.

Sir Michael called for an urgent review of safeguarding arrangements between the government and councils, as well as a review of home education – pointing to evidence that some schools were using the “freedoms afforded to genuine home educators as a cover for their activities”.

Last September Ofsted launched an investigation into unregistered schools at the request of the Department for Education (DfE). The watchdog has so far looked into 28 cases.

Sir Michael said: “The arrangements for closing down unregistered schools are inadequate. Despite our reported findings, I understand that no individual has ever been prosecuted for operating an unregistered school.

“Difficult as it may be to build a legal case that may have a reasonable prospect of success in court, I remain concerned that not enough is being done to stop this illegal activity.

“Too many children remain at significant risk of harm. I will continue to do all that I can to identify and inspect unregistered schools.”

Sir Michael also said councils were not acting swiftly enough to identify unregistered provision and ensuring the safety of children and young people, adding that his regional directors had expressed concerns that there were “far greater numbers” of children hidden away from view than Ofsted’s findings suggested.

He added: “Local authority officers acknowledge the problem, but too often use the excuse of bureaucracy, legislation or lack of resources as a reason for inaction.”

He said DfE staff had recently requested “further support” from Ofsted for building the “necessary legal case” to prosecute operators of unregistered schools, and pledged his “full support”, adding: “All schools must be registered or closed down.”

In response, Ms Morgan said the government had taken “robust steps” to tackle unregistered schools and improve safeguarding since 2010, but conceded that “more needs to be done”.

She added: “That’s why the Prime Minister announced at the Conservative Party conference that we will introduce further powers to regulate settings which teach children intensively and to intervene and impose sanctions where there are safety or welfare concerns.